As buyer’s agents at Key2Dreamz, we’re closely watching the latest data. Underlying (trimmed mean) inflation jumped to 3.0% in September 2025, sitting right at the top of the RBA’s target range of 2–3%. Overall inflation (CPI) rose by 3.2% over the year which means prices across the economy are still rising faster than the RBA’s ideal midpoint of 2.5%.
The biggest pressure came from housing and utilities. Electricity prices alone soared 9.0% during the September quarter and 23.6% over the year, helping push up the overall housing group, which includes rents, utilities, and new home costs, by about 4.7%. By comparison, rents rose more slowly (around +3.8% year-on-year) and the cost of new homes increased just +0.9%.
In short, while general inflation is around 2.5 to 3%, essential housing costs are climbing faster than that, meaning household budgets are still under strain even as inflation overall begins to stabilize.
Major banks have reacted by pushing out rate cuts into 2026. Economists at CBA, Westpac and Bendigo Bank now expect the RBA to keep rates on hold for a prolonged period. In practice, this means your borrowing costs should stay steady for a while. This rate stability is good news for planning: it gives buyers and investors clarity when budgeting for a loan or rent.
Implications for Buyers and Investors
From our buyer’s agent perspective, these trends have a few clear takeaways:
- Stability in rates: Interest rates are going to be stable for at least the current future. Your interest costs are going to be fairly predictable since rate cuts will likely not be until at least 2026. You can invest in securing a home loan agreement today and not have to worry about something adverse happening. Stable rates mean you will be better able to plan for monthly budgets and make comparisons for homes.
- Land-backed homes benefit: Inflation in construction and utility costs tends to lift land-rich property values. Detached houses (with land) often hold their value better than apartments when costs rise. In other words, stand-alone homes generally offer a stronger hedge against inflation than high-rise units. We expect strong demand for family homes on land in the current market.
- Act sooner rather than later: With borrowing costs steady, now can be a smart time to buy. Securing a property or investment today locks in current mortgage conditions before any changes. It also positions you ahead of others – especially if cuts aren’t coming until late 2026. In short, you avoid potential price rises and are ready to move when the competition heats up.
For tailored help, see our Residential Buyer’s Agent and Investment Property services. We at Key2Dreamz are first-home buyers and investors in suburbs and properties with strong long-term potential.Ready to discuss your goals? Contact us at +61 439 260 917 or book a free consultation. You can also visit our Real Estate News blog for more market insights and tips.